** Russian President Vladimir Putin has widened the Kremlin's takeover of Japan Tobacco's business in Russia, adding three more companies to the list placed under temporary state administration. The move extends a decree signed on Thursday that stripped Japan Tobacco International (JTI) of control over its four Russian manufacturing operations.

The original order put stakes in four JTI businesses under the administration of Russian company Industrial Assets. A second decree, published overnight, extended the measure to three further companies owned by JTI Investments Sarl. No reason was given in either decree, although the Kremlin has previously linked similar seizures to actions by countries it considers hostile to Russia.

Tokyo protests through diplomatic channels

Japan has formally protested and demanded the measure be withdrawn. Finance Minister Satsuki Katayama said on Friday that Tokyo had lodged its complaint through diplomatic channels. The Japanese government owns around 37 per cent of Japan Tobacco Inc., whose brands include Winston and Camel cigarettes.

JTI is Russia's largest tobacco manufacturer by sales volume and has operated in the country since 1999. Japan Tobacco confirmed on 6 November that four of its Russian manufacturing subsidiaries had been placed under temporary management. The Russian business accounts for about 10 per cent of the group's revenue and roughly a quarter of its operating profit.

A mechanism used since 2023

The seizures use a temporary management system introduced in April 2023 for designated foreign-linked assets. Under it, the owner formally keeps its property but loses control of management, and the appointed manager may exercise ownership rights but cannot sell the assets. Similar measures were applied in September to the Russian assets of companies including Nestle, Metro and Auchan. Industrial Assets said it would maintain production and preserve existing teams.